Accounting ARC
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Use Smart Compensation to Drive Partner Performance
Five management objectives to address.
By Domenick J. Esposito
8 Steps to Great
“Show me your compensation plan and I’ll show you your strategy.” – Dom Esposito
As you strive to become a mid-market sustainable brand, your firm needs to become a performance-driven organization if you want to take advantage of future opportunities and drive growth and profitability. An effective performance management and compensation plan (PMCP) is critical to making your firm’s strategic plan a reality.
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The basic premise is that compensation rewards first look to:
- how successful the entire firm is,
Loyalty Tax: Accounting’s Lose-Lose Incentive System | Big 4 Transparency
Employees lose stability and firms lose money. So why do we do it?
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Big 4 Transparency
By Dominic Piscopo, CPA
For CPA Trendlines
A growing body of compensation data suggests that accounting firms may be unintentionally penalizing their most loyal employees.
In a recent solo episode of the Big 4 Transparency, founder Dominic Piscopo unpacks what he calls the “loyalty tax” — the pay gap between internally promoted employees and externally hired peers performing the same role. Drawing on 2024–2025 compensation data from thousands of U.S. and Canadian professionals, Piscopo outlines how this structural imbalance is reshaping career incentives across the profession.
MORE Dominic Piscopo | MORE Private Equity | MORE Pay & Compensation
The loyalty tax, as defined in the episode, is the percentage difference in pay where externally hired employees earn more than internally promoted employees at the same level. According to the data, that gap is far from trivial. In the U.S., first-year senior associates hired externally earn roughly 6.3% more than internally promoted seniors, while first-year managers see an 8.9% premium. Even at the senior manager level, the gap persists. Canadian data shows a similar pattern, with especially pronounced spreads at the senior and senior manager levels.
The disparity is even more striking in consulting and advisory roles.
CPA PE Deal Tracker™: The Next Deal Cycle Comes into View
By CPA Trendlines Research
Wall Street’s buying spree for accounting firms is cooling going into the fourth quarter of 2026, according to the CPA Trendlines CPA PE Deal Tracker™, as platform firms digest a two-year surge of acquisitions and the earliest investors, from three to five years ago, begin to cash out.
MORE Private Equity: Michael Hoover: Growth Without Discipline Comes at a Cost | Big 4 Transparency | CBIZ Told Grant Thornton No, No, No, Before Saying Yes | PE Already Knows Your Price. Do You? | How Private Equity Turns CPA Loyalty into Legal Risk | Ira Rosenbloom: PE Forces Firms to Pick a Future | The Disruptors | Allan Koltin: What Elite CPA Firms Do Differently | Gear Up for Growth
The October 2026 edition of the CPA PE Deal Tracker™ shows accounting’s private-equity deal flow easing in the third quarter, with 37 acquisitions in the U.S. and Canada, down from 42 a year earlier and a far cry from this year’s first-quarter surge of 58. The Tracker now counts 400 such deals in the U.S. and Canada since its records began in December 2016, plus 87 it has found elsewhere, for 487 worldwide, although its coverage outside North America is not systematic.
Advisory Includes More Than You Might Think
What do you see when you envision your future?
By Rory Henry
The Holistic Guide to Wealth Management
I work at a virtual family office called Arrowroot Family Office. Over the course of my career I have learned that family (and family dynamics) significantly shapes who we are and how we form relationships in life.
Research shows that one of the biggest drivers of family dynamics is the order in which each child is born. Birth order theory, developed by Alfred Adler in the 20th century, suggests that the order in which children are born can have a significant impact on their development and personality.
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Karen Reyburn: Use Your Creativity as a Competitive Advantage | The Disruptors
Curiosity, problem-solving, and creative habits help strengthen marketing, improve client experiences, and bring more humanity to an AI-driven profession.
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The Disruptors
With Liz Farr
For CPA Trendlines
Karen Reyburn, managing director of We Are PF and author of the new book Accountants, You Are Creative, wants accountants to embrace their innate creativity.
Reyburn’s first book, The Accountant Marketer, laid out the building blocks of marketing for accounting firms based on what worked for the firms that she and PF worked with. She noticed that just having a playbook and structure for marketing wasn’t enough. “The accountants who were seeing the greatest success, the greatest transformation for themselves and their clients, were the ones that either knew that they were creative human beings, they knew they had creativity within them, or at least they were open and curious about what that looked like, and willing to try,” she explains.
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As she watched AI’s rapid advancements over the last few months, she nearly shelved the manuscript. “Is this even relevant anymore? With all this stuff about AI, does anyone care about this mindset of creativity?” she wondered. But as she thought about AI and talked to accountants, she realized she was seeing a “both, and” moment. “You’re seeing leaning into AI to help you with tasks and repetition, and you’re seeing people want more humanity, more opportunity to trust you, more case studies, more in-person events,” she explains.